Marketing plan of Burger King outlines its overall marketing efforts.
EXECUTIVE SUMMARY
The world’s one of the leading hamburger chain was founded in 1953.The company have been operating in over 70 countries and 90% are privately owned franchises.This executive summary demonstrates the brand value of Burger King and how the company has revolutionized itself over the years.
Despite of the challenges and intense competition in the market, the Burger King holds a strong position with the help of its successful marketing strategies. The tastes of its hamburgers are much better than McDonalds but they are unable to make the brand perception as strong as McDonalds globally.For Burger King, the move to merge with the Canadian market will bring out a potential hook for those millennial who love coffee and breakfast sandwiches.
THE CHALLENGES AND GOALS
The organizational goal of Burger King is to serve its customers with the best quality fast food. The brand is known to be the second largest burger chain in the US. The recent most strategic goal adopted by the company is to buy Tim Hortons (THI) .The aim is to merge with the Canada’s biggest seller of Coffee and Doughnuts.
SITUATIONAL ANALYSIS
COMPANY ANALYSIS
Burger King World wide Inc is a global chain corporation that works as franchises and operates fast food hamburger restaurants under the brand name of Burger King. The company offers a diversified menu item from burgers, milk shakes, soda etc. The company achieve revenue from three sources i.e. franchise revenues, the property income that they receive from leasing or subleases to franchises and retail sales.
1.GOALS
The Burger King and Tim Hortons made an agreement under which the two companies will establish a new global powerhouse in the quick service restaurant sector.
2.FOCUS
The Company constantly focuses on the menu development, market penetration and basically works on an establishment based model.
3.CULTURE
The Burger King adopts a specific culture and values that is noticeable in the form of diversified menu items they offer. They advocate the culture of “Have it your way” to attract the customers.
4.STRENGTHS
The biggest strength of the Burger King lies in their geographic expansion by operating 11,500 fast food restaurants mostly located in over 70 countries.
5.WEAKNESSES
The product line is highly focused on the fast foods which may withdraw those customers who are conscious about their health especially children.
6.MARKET SHARE
The current earnings growth rate is +15.96%.and the annual revenue gained last year was up to $1.1bn.
CUSTOMER ANALYSIS
The company has a strong product offering to attract and retain the loyal customers. According to the recent news, the company acclaimed that they have been attracting more customers after the launch of Satisfries, in North America. The Satisfries are low calories French fries which have got 20% lower calories than a regular fries. This brought an incremental change in the customers who would not think of Burger King before.
COMPETITOR ANALYSIS
COMPANY: McDonalds
McDonalds’ is the world’s largest chain of fast food restaurant that serves around 68 million customers worldwide. The secret behind McDonald’s success is the strategic competitive advantage and remarkable supply chain. They offer the food at the lowest price possible comparatively to its rivals and have a strong distribution channel as well.
STRENGTHS OF MCDONALDS
• Largest fast food market share worldwide.
• Diversified product line.
• Strong brand presence.
• A growing middle class has a massive customer loyalty.
WEAKNESSES
• Unhealthy food menu.
• Negative image for introducing unhealthy food items in their menu that causes obesity.
MARKET CAPITAL:
It has market capital of $91.84BN.
COLLOBARATORS
JOINT VENTURES
A huge joint venture between Tim Hortons and Burger King will take place that aims to achieve $23billion sales.
DISTRIBUTERS
US, UK, Canada etc.
CLIMATE: PEST ANALYSIS
POLITICAL ENVIRONMENT:
The Company has faced a major political issue in the Middle East countries regarding Halaal food. According to the Government’s policy, they had to supply halaal meat and vegetarian fresh foods. Besides this, the government had made a quota of countries national to be hired at Burger King as an employee.
ECONOMIC ENVIRONMENT:
When the inflation rate gets high, the company tries to lower down the prices and focus on packaging meals.
SOCIAL AND CULTURAL ENVIRONMENT
The Social-cultural factors vary from country to country. In an Islamic Country the company has to be careful about the content of food such as the burger king only serves halaal food to the Muslim countries and refrain from pork meat.
TECHNOLOGICAL ENVIRONMENT
The Company has recently planned to add a mobile payment option in all its domestic stores. The application will help to provide coupons and nutrition facts.
SWOT ANALYSIS
STRENGTHS
• Geographic Diversification: Burger King has adopted a geographical strategy by expanding its business in over 70 countries where 4538 are located internationally in Asia, Middle East etc.
• Strong brand presence
• Diversified product offerings.
• Advertising campaigns are appealing.
WEAKNESSES
• Some people avoid Burger King because of its unhealthy food items.
• International appeal is quite low.
• Franchise management is weak.
OPPORTUNITIES
• Market expansion.
• New Product Development, catering to the needs of the consumers like new healthy menu etc.
THREATS
• Food costs get high during inflation period.
• Fierce Competition with McDonalds, Hardees, KFC.
MARKETING SEGMENTATION
The Burger King has developed three market segments for its customers such as Kids, African- American teenage crowd, working women. For kids, they have formed a full developed integrated new products, menus, media and advertising. The working women segment is specifically based on the menu products like chicken tenders, chicken sandwiches, and salads.
GROWTH STRATEGY
Burger king’s new move to merge with Tim Hortons is considered to be a growth strategy from both the brands. However, some people have disapproved this stance of Burger King as it’s a tax aversion strategy by the company. The company denied this rumor and stated that they want to bring together both the companies under one flag to serve even better.
INTEGRATED DIGITAL MARKETING STRATEGY
The digital marketing is a new target move and the company has been constantly innovating through enhancing all the channels of communication to serve the customers with the best possible experience.
MARKETING MIX (4P’S)
PRODUCT
• Began the business with burger and fries.
• Adaptive strategy.
• Diversification strategy tailoring the needs of the customers.
PRICE
• Psychological marketing strategy.
• The company continues to sell the new premium burgers, the Steakhouse XT at $3.99.
PLACE
• Burger King receives its revenues from three sources: sales at its own restaurants, property income and the franchise fees.
• The company is operating in various prime locations mostly in the form of franchises.
PROMOTIONS
• The launch of $1 big value meal.
• The company used the term of “Next big move” to showcase the scheduled promotional tours in urban communities around the country.
FINANCIAL PROJECTIONS
In the first half of 2014, the Burger King’s global unit count grew to more than 5%, previously expanding into 682 locations and to more than 13,808 units in 2013.
CONCLUSIONS
The blockbuster deal with Tim Hortons will open new growth opportunities for Burger King and will be interesting to watch how it performs in the next quarter.